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Gold Coins: A ‘Barbaric Relic’?

John Maynard Keynes once called gold coins a ‘barbaric relic,’ and in a way he was right.

Gold coins are relics, which fairly well explains the mess the economy is in today. And they did exist in barbaric times. But gold coins survived through the ages, right up to the 20th century. Of a century marked by endless war and unfathomable sacrifice of human life, barbaric seems a fitting description even now. And for most of that century gold coins were extinct.

None-the-less, rhetoric such as Keynes’ still dominates anti-gold-standard discourse. Shaun Connell wants to set the record straight.

In a post in Seeking Alpha (you can read it in its entirety here) Connell first offers an explanation for the tone of the rhetoric: “The anti-gold crowd has often resorted to … painting the situation with condescending words … [because] mockery is often far more convincing than the most rational argument.” Or, as Alan Greenspan once described it, “an almost hysterical antagonism toward the gold standard.”

Behind the antagonism, Connell contends, is a fundamental misunderstanding of gold. When people see gold as “old fashioned” it is only “evidence that it has withstood the test of time.” In terms of purchasing power, gold has a better “track record than any stock index, option, corporation, government, or fiat currency in history – nothing even comes close.”

Murray Rothbard, one of the great economic minds of the 20th century, summed up gold’s history in one sentence: “Gold had developed for many centuries on the free market as the best money; as the commodity providing the most stable and desirable monetary medium.”

The implication is that the anti-gold camp is opposed to a stable monetary system. While that may be true of some individuals in the camp, it is only mockery to say it of the whole. The rules apply to both sides. Labels can only divide and anti-gold is both misleading and unwarranted. The gold debate takes place between pro-gold and pro-fiat money camps.

The debate will go on for as long as mankind clings to the belief that wealth can be created from nothing. But if history means anything, no matter which side you are on, there is more than ample reason to hedge your bets with gold coin investment.

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